SPECIAL REPORT: ‘Hot fuel’ lawsuits heating up on both coasts

| Friday, December 15, 2006

Dec. 15, 2006 - Another log has been tossed on the fire in the debate about "hot fuel" and consumer protection.

A group of consumers filed a lawsuit Friday, Dec. 15, in a U.S. District Court in New Jersey, alleging that major fuel companies and retailers are knowingly ripping people off at the pump by selling fuel above 60 degrees without compensating in price or volume for the expansion of the liquid.

In other words, the consumers contend they haven't been getting the amount of fuel energy per gallon they paid for when fuel was sold above a standard temperature of 60 degrees without being compensated.

A similar lawsuit was filed by a group of plaintiffs on Wednesday, Dec. 13, in U.S. District Court in San Francisco.

Research by Project Leader John Siebert of the Owner-Operator Independent Drivers Association Foundation has jumpstarted consumer interest, media attention and the lawsuits themselves.

"The plaintiffs are asking for temperature compensation at the pump from this time forward," Siebert said. "If a pump is not pumping temperature-compensated fuel, they want it posted on that pump. That, and they want restitution for all of the ill-gotten gains and profits gained from the sale of hot fuel."

The dollar amount is not yet defined, he said.

The plaintiffs are seeking class-action status for the lawsuit for consumers in California, New Jersey, Arizona, Texas, Florida, North Carolina and Virginia. A judge will make the decision whether the lawsuit can become a class action.

Siebert, with the help of the Association's member truck drivers and owner-operators, researched fuel temperatures and whether fuel pumps in some warmer states compensated for the fuel's expansion when it was being sold at higher than 60 degrees.

The 60-degree standard was created by the oil companies and regulators themselves in the early 1900s, and as the lawsuit suggests, the wool has been over consumers' eyes for a long time.

The Kansas City Star reporter Steve Everly opened the eyes of the mainstream media with an exposé on "hot fuel" and the allegations of consumer fraud with a series of articles beginning in August.

Oil companies have claimed retrofitting the fuel pumps would be cost-prohibitive and affect the market price of fuel.

Joan Claybrook, president of Public Citizen, said in a teleconference to announce the California lawsuit that the effort to stop consumer fraud is fueling the legal challenges.

"Ultimately, Congress needs to protect U.S. consumers against the industry-wide practice of hot-fuel overcharges," Claybrook said.

Siebert said there is more than one lawsuit because of the way fuel retailers market and sell fuel.

"Some of the retailers specialize in regional sales," he said. "Part of the reason is to be able to include all of the groups."

For example, ExxonMobil is not included in the list of defendants in California, but is listed in New Jersey.

Seventeen oil companies and retailers are named in the California lawsuit, including Chevron, 7-Eleven, Wal-Mart, Citgo and Flying J.

In New Jersey, the number of defendants is five: Amerada Hess Corp., ExxonMobil, Getty Petroleum Marketing, Motiva Enterprises and Sunoco.

The list of plaintiffs differs in the two lawsuits but a few plaintiff names cross over in both lawsuits.

"Most of them are owner-operators," Siebert said, adding that the owner-ops tend to keep more receipts than other consumers.